SINNAMY AIYER v. BALAMPIKAI AMMA

009-NLR-NLR-V-31-SINNAMY-AIYER-v.-BALAMPIKAI-AMMA.pdf


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Present Dalton and Akbar JJ.
SINNAMY AIYER v. BALAMPIKAI AMMA.
449—’D.C. Jaffna, 22,734.
. • Bond—Agreement to convey land—Payment of damages in default—Period of prescription—Ordinance No. 22 of 1871, ss. 6 and 7.
A document setting out an agreement to convey land andin defauljt, providing for the payment of a sum of money as thevalue of the land and a further sum by way of liquidated damages,is not a bond conditioned for the payment of money, withinthe meaning of section 6 of the Prescription Ordinance, No. 22of 1871.
An action upon such an agreement is prescribed in six years.^J^PPEAL from a judgment of the District Judge of Jaffna.
Plaintiff brought this action to obtain specific performance ofan agreement to convey certain lands or in the alternative to'recover a sum of Rs. 750 and a further sum of Rs. 500 by way ofliquidated damages. The material part of the document uponwhich the action was based was as follows: —
I, the said party of the first part, do declare and undertaketo convey by way of deed one-half share of the remainingproperty (immovable) inclusive of my acquisition belong-ing to me and my husband unto the party of the secondpart in equal shares and also to pay a sum of Rs. 250to the first-named person of the second part for theremaining movable property within a period of one yearsince the time of the. closing of the said last will andtestament …. In the event of my failing toconvey the said property as agreed upon within thestipulated time or within a period of two years from thisdate unto the respective, persons or their respective heirs,&c., I undertake to pay a sum of Rs. 750 for the value
of the immovable propertyI also agree
and bind my heirs, &c., to pay an additional sum ofRs. 500 as liquidated damages.
The date of .the agreement was March 16, 1919, and the plaintin the action was filed on June 29, 1927. The agreement not beingcarried out, the cause of action arose on March 16, 1921 ; thedefendant pleaded that the action was prescribed.
1829.
( 48 )
1929.
SinnamyAiyer v.Oalampikai
Ammo,
The learned District Judge held .that the instrument was a bondconditioned for tne. payment of money and that, under section 6of the Prescription Ordinance, an action on it may be commencedwithin ten years of the cause of action.
H. V. Per era, for defendant, appellant—This action is framedas an action for specific performance of an agreement to transferland.
In Ismail v. Ismail 1 it was decided that the period of prescriptionin the case of an agreement to transfer land is that laid downin section 7 of Ordinance No. 22 of 1871, viz., six years. In thiscase, too the document is in substance – an agreement to .transferland, and therefore section 7 would apply.
The mere provision in the document for damages and the value©f the land to be paid in the event of a failure to perform theagreement, to transfer the land does not give the document ,tbecharacter of a “ bond ” and make the period of prescription ten years.
A “ bond conditioned for the payment of money ” has a definitetechnical legal significance. Every undertaking to pay money onthe failure to do something or give something contained in a'document does not make that document a bond. This was theview taken in Simon v. de' Silva.2 That case discusses the legaltopic fully and, it is submitted, contains a correct exposition of thelaw, viz., that it is not the mere form of the document thatdecides the question whether a document was a bond or not.
This is not a case where part payment will stop the statute.
Soertsz, for pjaintiff, respondent.—“ Bond ” is not defined inOrdinance No. 22 of 1871, it is taken over from the English Act. InEnglish law- it has a definite te/hnical meaning. See 3 Halsbunfshaws of England. As the word “ bond ” has not been defined in ourOrdinance, and as it cannot be given its full English law significancein our law, we must give it a meaning, that is, as approximate aspossible to the English law meaning of the word. That is theview taken by Bonser C.J. in Tissera v. Tissera. 3
As a deed attested by a Notary is the nearest to the Englishdeed poll under seal, a promise to pay a debt contained in suchan instrument must be construed as a bond. That is the view.taken by Bonser C. J.
There is such a promise in this document which is. notarially.attested and, therefore, section 6 governs the case and the periodof prescription is ten years.
Bonser C.J.’s view was adopted in Suprammiam Pillai v. Kali-•cutty, * Semon v. Silva, 5 although in some of the cases the JudgesTefused to accept C.J. Bonser’s -definition of “ bond ” as an
» 22 N. L. R. 476.3 2 N. L. R. 238.
31C. W. R. 71.* 11 N. L. R. 71.
s 18 N. L. R. 397.
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•exhaustive definition. They, however, admitted that the test 1939,
proposed was a good one and that such a promise was one
instance of a bond.Aiyer v.
In this case there is also part payment which will stop the statutewhether section 6 or section 7 of Ordinance No. 22 of 1871 be applied.1
•July 1, 1929. Dalton J.—
This appeal raises a question under the Prescription of ActionsOrdinance, No. 22 of 1871. Plaintiff (respondent) brought theaction to obtain specific performance of an agreement to conveycertain movable and immovable property or in. the alternativeto recover certain sums of Es. 750 and Rs. 500, respectively, interms of the agreement, and a further sum of Rs. 500 by way ofliquidated damages.
The document PI upon which the action is based is headed“ Instrument, Agreement, and Renunciation.” It is datedMarch 16, 1919, is notarially executed, and is between the presentdefendant (appellant) on the one side and plaintiff and his sincedeceased brother on the other. After setting out several recitalsthe material part is as follows: —
Know all men by these presents that I the said party of thefirst part do declare and undertake to convey by way' of adeed one-half share of the remaining property (immovable)inclusive of my acquisition belonging to me and myhusband unto the said second part in equal shares, and alsoto pay a sum of Rs. 250 to the first-named person of thesecond part for the remairing movable property (excludingthe cattle that are to be shared as recited above) withina period of one year since the time of the closing of thesaid last will and testament. I also declare that thesecond part should bear the expenses of the executionof the said deed and that in the event of my failing toconvey the said property as agreed upon within the saidstipulated time or within a period of two years fromthis date in case of such time prolonged by chance unto• the respective persons or their respective heirs, executors,and administrators, I undertake to pay a sum of Rs. 750for the value of the immovable property which oughtto be conveyed and also the said sum of Rs. 250 for themovable property, making a total sum of Rs. 1,000.
I also agree and bind my heirs, executors, and adminis-trators to pay an additional sum of Rs. 500 a? liquidateddamages together with the said sum of Rs. 1,000 ondemand after date.
> 5 S. C. C. 62 ; 14 N. L. /?. 1 ; 17 N. 1,. li. 156.
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Dai/k>n J.
SinnamyAiyer v.Balampikai
Ainma
The original plaint in the action was filed on June 29, 1927,and the agreement not having been carried out, the cause of actionarose on March 16, 1921. The question arises therefore whetherthe claim is prescribed.
The trial Judge has held that the instrument is a " bondconditioned for the payment of money.” Under section 6 of theOrdinance an action upon such a bond, must be commenced withinten years from the expiration of the time provided for the perform-ance of the condition. It is urged for the appellant, however, thatthe instrument is not a bond, but falls under the provisions of sec-tion 7 of the Ordinance and the action is prescribed after six years.
We have heard a lengthy argument upon what has been describedas ” the vexed question as to what is a ‘ bond ”, and numerousauthorities have been cited to us, including Tissera v. Tissera,1Suppramaniapillai v. Kalikuttu, 2 In re Section 38 of Stamp Ordinance,1890,3 Seman v. Silva,* and Selvanayagi Amma et al. v. KandapperUpathar* Of these various decisions the decision of Ennis andde Sampayo JJ. in Seman v. Silva (supra) is the one which I wouldprefer to follow; the reasoning of de Sampayo J. as set out in hisjudgment seems to be equally applicable to the instrument in thiscase, as in the case before him. On the question of notarialexecution he says: ” The fact of notarial execution, if I may sayso with respect, has nothing to do with the character of a documentas a bond in Ceylon. ” He goes on to say that an instrumentshould be construed as a bond or the contrary according to itssubstance and real characteristics and not according to its formof execution. As he points out, in the case of bonds affectingan interest in land, the want, of notarial execution will make itinvalid to that extent under Ordinance No. 7 of 1840. He has inthe course of his judgment considered the history of the legislationin Ceylon on the subject of prescription. It might also be pointedout that, if notarial attestation as I understand has taken theplace of the Roman-Dutch law requirement of registration asprovided for in the Placaat of 1665 and the payment of duty,there are instruments in Roman-Dutch law which clearly comewithin the term ‘‘ bond ”whichrequired neitherregistration
nor payment of duty fortheirvalidity. Amongstsuchare
kustingen and bottomry bonds. *
The instrument Pi has been notarially executed because itaffects an interest in land. It appears to be stamped as an agree-ment. Its •primary purposeis the undertaking toconveythe
immovable property referredto. A value is placeduponthat
immovable property and also upon the movable property, andin the event of her failure to convey, within the time stated, she
1 2 N. L. R. 238.4 18 N. L. R. 397.
»11 N. L. R. 11.6 5 A. C. R. 64.
• 12 N. L. R. 281.‘ Nathan II., 1924.
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4the defendant) undertakes to pay these sums. She further agreesto pay the sum of Bs. 500 as liquidated damages in case she breaksher contract. I am quite unable to agree with the trial Judge-that this is a “ bond.” It is not necessary to enter into the difficult.question of deciding what is a " bond ” in Ceylon, but I am satisfiedthat this document setting out an agreement to convey land,.and providing for the payment of a sum as liquidated damagosin the event of failure to convey, is not a “ bond conditioned forthe payment of money.” The trial Judge’s decision that it comesunder section 6 of the Ordinance is therefore wrong, and the termof prescription is therefore six years as provided in section 7.
Here, however, a difficulty arises in disposing of the case, for thetrial Judge having held that the term of ten years was applicable,did not find it necessary to consider whether there had been at anytime an acknowledgment of the debt, by part payment or otherwise,as to take the case out of the Ordinance. There is evidence of.a payment by the defendant at some point of time apparentlyafter the cause of action arose. The endorsement of receipt byplaintiff on the instrument Pi is dated January 10, 1925. It hasbeen iirged before us that no question on this point was raised inthe lower Court, but it seems to me that plaintiff might have raisedit on the issue of prescription, although of course it would havebeen much better to have had an express issue on the point. Thetrial Judge however decided before any evidence was led that theinstrument was a bond under section 6, and hence the questionof acknowledgment of the debt to take it out of section 7. did notarise. The case must therefore go back for this question to bedecided. The trial Judge should f.-ame a definite issue to cover it.The appeal is allowed and the order of the lower Court will be setaside, and the case sent back for the/ hearing to continue on thisissue. Costs incurred in the lower Court will abide the event,
• bufc appellant is entitled to costs of the appeal.
Akbar J.—
The plaintiff brought this action for specific performance of anagreement made by the defendant who is the widow of one Ayaturai,Aiyar asking for the transfer of certain lands or in the alternativefor the recovery of a sum of Bs. 750 and a further sum of Bs. 500as liquidated damages. After Ayaturai’s death there was a disputebetween the defendant on the one side and the plaintiff and hisbrother (who are the brothers of the deceased Ayaturai) on the other.This dispute, however, was adjusted between them by the partiesentering into the document marked PI dated March 16, 1919.The material" parts of this deed are as follows: — –
” Know all men by these presents that I the said party of the firstpart do declare and undertake to convey by way of a deedone half of the share of the remaining property (immovable)
1928.
Damon J.
SinnamyAiyer v.Balompikai
Ammo.
31/7-
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1929.
Akbab J,
SinnamyAiyer v.BalampikaiAmma
inclusive oi my acquisition belonging to me and my husbandunto the said second part in equal shares and also to pay asum of Rs. 250 to the first-named person of the second partof the remaining movable property (excluding the cattle.that are to be shared as recited above) within a period ofone year since the time of the closing of the said last will andtestament. I also declare that the second part should bearthe expenses of the execution of the said deed and that inthe event of my failing to convey the said property as agreedupon within the said stipulated time or within a period oftwo years from this date-in case of such time prolonged bychance unto the respective persons or their respective heirs,executors, and administrators, I undertake to pay a sum ofRs. 750 for the value of the immovable property which oughtto be conveyed and also the said sum of Rs. 250 for the mov-able property, making a total sum of Rs. 1,000. I also agreeand bind my heirs, executors, and administrators to pay anadditional sum of Rs. 500 as liquidated damages togetherwith the said sum of Rs. 1,000 on demand after date.”
The estate was closed on April 16, 1920, and the plaintiff admits,that the defendant has paid the sum of Rs. 250 provided for in theagreement above, but states that the defendant has failed to transferthe lands or to pay the alternative sum of Rs. 750. He therefore (hisbrother having died and lie being the sole heir of his dead brother)claims for specific performance of the agreement or for the alter-native payment of the .two sums mentioned in the agreement. Thedefendant pleaded that she had paid the full sum of Rs. 1,000, andshe also raised the issue that the claim was prescribed. On the factsthe District Judge has held that- only a sum of Rs. 250 has been paidas alleged in the plaint, and I see no reason why this finding of factshould be interfered with. On the issue of prescription severalinteresting points have arisen in this case which require considera-tion. The District Judge held early in the case before any evidencewas led that this case was governed by section 6 of Ordinance No. 22of 1871 and that therefore the claim was not prescribed. He cameto this conclusion because in his words ” the agreement is anagreement to transfer land, or alternatively a bond conditioned forthe payment of money in lieu of a transfer and therefore section <5is apposite.” The first question for decision is whether the DistricrJudge is right in holding that the document in question is a bondwithin the meaning of section 6 of the Prescription Ordinance. Asde Sampayo J. says in the case of Don Seman v. de Silva1 “ thevexed question as to what is a ‘ bond ’ was argued in this case too ”.It was urged for the respondent that as this document was notariallyattested it was a bond on the authority of Tissera v. Tissera.2
> 1 C. W. B. 71.
2 (1897) 2 N. L. B. 238.
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The following cases were also cited during the course of theargument <—Mohamadaly Marikar v. Assen Naina Marikar,1SuppramaniapiUai v. Kalikutty,1 the case reported in XII. N. L. B.p. 281, Suthukkummah v. Yachckiravage,3 Selvanayagi Amma v.Kandapper Upathar, * and the case of Don Seman v. de Silva (supra).It will be seen from document FI that it is not in the form ordi-narily known as a bond in which class of documents the obligorhinds himself to pay a certain sum of money with a condition thatthe bond is to be void on the payment of a certain sum of money oron the performance of a certain act. The form of PI is nothingmore than that of an agreement with the additional formality of anotarial attestation. The attestation clause shows that the docu-ment was stamped with a stamp of Rs. 10.50 showing that theparties themselves recognized the document as nothing m<>re thanan agreement to transfer land and also as an agreement to paymoney. It has not been stamped under any of the sub-heads ofitem 15 of the schedule to the Stamp Ordinance.
In volume III of Halsbury's Laws of England a “ bond ” is definedas an instrument under seal, whereby one person binds himself toanother for the payment of a specified sum of money and when theform of the bond fs accompanied by a condition in the nature ofa defeasance it is called a double or conditional bond.
The question that I have to consider is not the meaning of theword “ bond ” but the exact meaning of the words “ bond condition-ed for the payment of money or the performance of any agree-ment or trust Or payment of penalty ” in section 6 of Ordinance, 1871.An exactly similar .bond was the subject-matter of the action inDon Seman v. de Silva (supra), iri which this Court held that anagreement to pay rent in a notarially attested lease was not a bond.
I prefer to follow the opinion of this Court as expressed in Don Semanv. de Silva (supra) in preference, to the earlier contrary opinion. Thenotarial attestation- was required in this case because PI wasessentially an agreement to transfer land which required notarialattestation for its validity under Ordinance No. – 7 of 3840.
This case, therefore, in my opinion falls under section 7 of Ordi-nance, 1871, and not under section 6. In view of this opinion afurther question arises in this case which has not been consideredby the District Judge. This question is whether the payment ofthe Es. 250 was a part payment, which had the effect of giving anew lease of life to the prescriptive period. According to the ■defendant’s case, which was disbelieved by the District Judge, shepaid the full Rs. 1,000 before the year mentioned in document PI.expired, but according to the plaintiff (and he is corroborated by anendorsement of the fact of payment attested by two witnesses madeI ic. L. R. to.3 (1910) 12 N. L. R. 289.
a (1909) 11 N. L. R. 11.* 5 A.C. R. 64. ■
1929.
Akbab J.
SinnamyAiyer r.BaiompikatAmina
( 54 )
1929.
Akbab J. ■
SinnamyAiyer v.BalmnpikaiAmma
on the document (PI) dated January 10, 1925) the payment was onJanuary 10, 1925. If this payment was made on that date thequestion arises whether this part payment does not stop prescriptionfrom running till that date. As I have stated, the District Judgehas not considered this question, in view of his order made early inthe case that the prescriptive period was ten years. As I hold thatthe prescriptive period is only six years, the question of part paymentis vital to the case. In my opinion document PI is an agreement .under which the defendant agreed to transfer the land and to paya sum of Rs. .250 within a period of one year of the closing of theestate and a further agreement that if she made default in carryingout the above obligation within this, period of one year or within aperiod of two years from the date of the agreement (March 16, 1919)she would pay a sum of Rs. 750 as the value of the immovableproperty and also the sum of Rs. 250 above mentioned and a furthersum of Rs. 500 “ as liquidated damages.” So that this agreementafter the lapse of the period fixed by PI is really an agreement topay Rs. 1,000 and further damages of Rs. 500. The payment of theRs. 250 in circumstances from which an acknowledgment of the debtcan be implied can, therefore! be taken as a part payment of theagreement to pay Rs. 1,000 which will have the effect of stoppingprescription beginning till the date of payment.
It has been held by this Court in the following cases, SawannaPana Lana Sathappa Chetty v. Kavmna Payana Muttu Ramen Chetty,*Bacho Appu v. Bamblan, 2 and Arunasalam v. Bamasamy, 3 that partpayment has the effect under section 13 of Ordinance No. 22 of 1871of breaking the prescriptive period, i.e., a part payment from whichan acknowledgment of the debt can be implied. It will be thus seenthat the questions whether there was such a part payment and ifthere was, the date of payment of the Rs. 250 are crucial to this caseand the case must, therefore, go back for the determination of theseissues. The burden of proving them will of course be on theplaintiff, and the parties will be at liberty to lead such furtherevidence as they may think proper. I agree with the order proposedby my brother Dalton. As the appellant has succeeded on the mainpoint she is entitled to the costs of appeal. The costs in the lowerCourt up to date will abide the final results of this case.
* 5 S.C.C.62.*{1912) 14 N. L. R. 1.
v.»{1915) 17 N. L. R. 156.
Appeal allowed.